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16 government departments are financially vulnerable

10 October 2018 5:35 PM
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16 government departments are financially vulnerable

Sixteen of government's departments are in a financially vulnerable position, the Auditor General has warned.

The financial health of government departments and some state-owned enterprises came under the spotlight at a briefing on Wednesday to the Standing Committee on Public Accounts and Appropriations. The Auditor General (AG) of South Africa informed committees on the audit outcomes of government departments and entities for the 2017/18 financial year.

According to the report 10% of government departments are in a vulnerable financial position. Only 53% are in good financial health status and 39% of government departments had a deficit - this means their expenses exceed revenue by R58.7bn.

According to the AG 55% of departments could not settle their liabilities which existed by year-end.

The report also indicated that 27% of departments took longer than 90 days to collect debt and 46% took longer than 30 days to pay their creditors.

As for state entities, the Auditor General indicated that the SABC and the Petroleum Oil and Gas Corporation are in a vulnerable financial position. Audits for SAA, the South African Post Office and Denel are still outstanding.

Overall, irregular expenditure is around R50bn. This is spend not in compliance with supply chain management legislation.

Fruitless and wasteful expenditure by government departments increased from R757m to R2.5bn, and unauthorised expenditure - which was not budgeted for - increased from R1.5bn to R2.1bn.


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